Investor Relations

Investor Relations

Press Release

Allegiance Bancshares, Inc. Reports Second Quarter 2018 Results

Company Release - 7/26/2018 7:00 AM ET
  • Core loan growth of $266.0 million, or 13.0%, year over year and $58.2 million, or 10.4% (annualized), for the second quarter 2018 compared to the linked quarter
     
  • Deposit growth of $214.5 million, or 10.2%, year over year and $29.0 million, or 5.1% (annualized), for the second quarter 2018 compared to the linked quarter
     
  • Announced the pending acquisition of Post Oak Bancshares, Inc. headquartered in Houston, Texas

HOUSTON, July 26, 2018 (GLOBE NEWSWIRE) -- Allegiance Bancshares, Inc. (NASDAQ:ABTX) ("Allegiance"), the holding company of Allegiance Bank (the "Bank"), today reported net income of $7.6 million and diluted earnings per share of $0.55 for the second quarter 2018 compared to $5.4 million and diluted earnings per share of $0.40 for the second quarter 2017.  The second quarter 2018 results include $1.1 million and $625 thousand of core system conversion and merger related expenses, respectively.  Net income for the six months ended June 30, 2018 was $15.3 million, or $1.12 per diluted share, compared to $11.4 million, or $0.85 per diluted share, for the six months ended June 30, 2017.

"This quarter was an exciting one for us as we further executed our growth strategies. We generated continued organic loan and deposit growth, successfully completed our core technology conversion and advanced our acquisition strategy by announcing a transaction with Post Oak Bancshares, Inc. headquartered in Houston, Texas," said George Martinez, Allegiance's Chairman and Chief Executive Officer.  "Allegiance and Post Oak share the same tradition of customer, employee and community bank focus and we continue to anticipate that the acquisition will close in the fourth quarter of 2018. We are excited about this partnership and the opportunities that will further enhance our value as Houston's largest community bank," commented Martinez.

"I would like to thank our outstanding team of dedicated employees for a remarkable job well done as we effectively enhanced our core  system during the quarter.  Our employees continue to ensure an outstanding customer experience every day to help our bank grow and innovate while working diligently to deliver great results.  We believe that this quarter's results reflect our commitment to our customers and the enhancement of shareholder value," concluded Martinez.

Second Quarter 2018 Results

Net interest income before provision for loan losses in the second quarter 2018 increased $2.7 million, or 10.8%, to $27.8 million from $25.1 million for the second quarter 2017 primarily due to organic loan growth partially offset by interest expense on the subordinated debt that was issued in December 2017.  Net interest income before provision for loan losses in the second quarter 2018 increased slightly from $26.9 million in the first quarter 2018.  The net interest margin on a tax equivalent basis decreased eight basis points to 4.21% for the second quarter 2018 from 4.29% for the second quarter 2017 and increased one basis point from 4.20% for the first quarter 2018. The decrease from the prior year is primarily due to the increase in interest expense on interest-bearing liabilities driven in part by the subordinated debt issuance in December 2017.

Noninterest income for the second quarter 2018 was $1.8 million, an increase of $328 thousand, or 22.2%, compared to $1.5 million for the second quarter 2017 and increased $159 thousand compared to $1.6 million for the first quarter 2018.

Noninterest expense for the second quarter 2018 increased $3.4 million, or 20.4%, to $19.9 million from $16.5 million for the second quarter 2017, and increased $1.1 million, or 6.1%, from $18.7 million for the first quarter 2018. The increases in noninterest expense over the second quarter 2017 and the linked quarter were primarily due to expenses of $1.1 million related to the core system conversion and $625 thousand of merger related expenses. In the second quarter 2018, Allegiance’s efficiency ratio increased to 67.05% from 61.92% for the second quarter 2017 and increased from 65.59% for the first quarter 2018.  Second quarter 2018 annualized returns on average assets, average equity and average tangible equity were 1.03%, 9.55% and 11.02%, respectively, compared to 0.81%, 7.32% and 8.57%, respectively, for the second quarter 2017.  Annualized returns on average assets, average equity and average tangible equity for the first quarter 2018 were 1.09%, 10.10% and 11.71%, respectively.

Six Months Ended June 30, 2018 Results

Net interest income before provision for loan losses for the six months ended June 30, 2018 increased $5.5 million, or 11.1%, to $54.7 million from $49.2 million for the six months ended June 30, 2017 primarily due to organic loan growth partially offset by the increased interest expense on interest-bearing liabilities.  The net interest margin on a tax equivalent basis decreased 13 basis points to 4.20% for the six months ended June 30, 2018 from 4.33% for the six months ended June 30, 2017 primarily due to the increase in interest expense on interest-bearing liabilities driven in part by the subordinated debt issuance in December 2017

Noninterest income for the six months ended June 30, 2018 was $3.5 million, an increase of $633 thousand, or 22.5%, compared to $2.8 million for the six months ended June 30, 2017.

Noninterest expense for the six months ended June 30, 2018 increased $5.6 million, or 16.9%, to $38.6 million from $33.0 million for the six months ended June 30, 2017.  The increase in noninterest expense over the six months ended June 30, 2017 was primarily due to expenses related to the core system conversion of $1.5 million and the merger related expenses of $625 thousand during the six months ended June 30, 2018.

During the six months ended June 30, 2018, Allegiance’s efficiency ratio increased to 66.33% from 63.41% for the six months ended June 30, 2017.

For the six months ended June 30, 2018, annualized returns on average assets, average equity and average tangible equity were 1.06%, 9.82% and 11.36%, respectively, compared to 0.89%, 7.95% and 9.34%, respectively, for the six months ended June 30, 2017.

Financial Condition

Total assets at June 30, 2018 increased $241.7 million, or 8.9%, to $2.97 billion compared to $2.72 billion at June 30, 2017 and increased $79.9 million, or 2.8%, compared to $2.89 billion at March 31, 2018.

Total loans at June 30, 2018 increased $244.0 million, or 11.5%, to $2.36 billion compared to $2.11 billion at June 30, 2017 and increased $68.2 million, or 3.0%, compared to $2.29 billion at March 31, 2018. These increases were due to strong organic loan growth within the Bank’s loan portfolio. Core loans, which exclude the mortgage warehouse portfolio, increased $266.0 million, or 13.0%, to $2.31 billion at June 30, 2018 from $2.04 billion at June 30, 2017 and increased $58.2 million, or 2.6%, from $2.25 billion at March 31, 2018.

Deposits at June 30, 2018 increased $214.5 million, or 10.2%, to $2.31 billion compared to $2.10 billion at June 30, 2017 and increased $29.0 million, or 1.3%, compared to $2.28 billion at March 31, 2018.

Asset Quality

Nonperforming assets totaled $14.6 million, or 0.49% of total assets, at June 30, 2018, compared to $19.9 million, or 0.73% of total assets, at June 30, 2017, and $14.2 million, or 0.49% of total assets, at March 31, 2018. The allowance for loan losses was 1.01% of total loans at June 30, 2018, 0.99% of total loans at June 30, 2017 and 1.08% of total loans at March 31, 2018.

The provision for loan losses for the second quarter 2018 was $631 thousand, or 0.11% (annualized) of average loans, compared to $3.0 million, or 0.59% (annualized) of average loans, for the second quarter 2017, and $653 thousand, or 0.12% (annualized) of average loans, for the first quarter 2018.

Second quarter 2018 net charge-offs were $1.4 million compared to net charge-offs of $684 thousand for the second quarter 2017 and net recoveries of $326 thousand for the first quarter 2018.

GAAP Reconciliation of Non-GAAP Financial Measures

Allegiance’s management uses certain non-GAAP financial measures to evaluate its performance. Please refer to the GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures on page 10 of this earnings release for a reconciliation of these non-GAAP financial measures.

Conference Call

As previously announced, Allegiance’s management team will host a conference call on Thursday, July 26, 2018 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its second quarter 2018 results. Individuals and investment professionals may participate in the call by dialing (877) 279-2520. The conference ID number is 8558406.  Alternatively, a simultaneous audio-only webcast may be accessed via the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Upcoming Events. If you are unable to participate during the live webcast, the webcast will be archived on the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under News and Events, Event Calendar, Past Events.

Allegiance Bancshares, Inc.

Allegiance is a $2.97 billion asset Houston, Texas-based bank holding company. Through its wholly owned subsidiary, Allegiance Bank, Allegiance provides a diversified range of commercial banking services primarily to Houston metropolitan area-based small to medium-sized businesses and individual customers. Allegiance’s super-community banking strategy was designed to foster strong customer relationships while benefiting from a platform and scale that is competitive with larger local and regional banks.  Allegiance Bank operates 16 full-service banking locations and one loan production office in the Houston metropolitan area. Visit www.allegiancebank.com for more information.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This release may contain forward-looking statements within the meaning of the securities laws that are based on various facts and derived utilizing important assumptions, present expectations, estimates and projections about Allegiance and its subsidiaries. Statements preceded by, followed by or  that otherwise include the words “believes,” “expects,” “continues,” “anticipates,” “intends,” “projects,” “estimates,” “potential,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. Forward-looking statements include information concerning Allegiance’s future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of Allegiance’s control, which may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include but are not limited to whether Allegiance can: continue to develop and maintain new and existing customer and community relationships; successfully implement its growth strategy, including identifying suitable acquisition targets and integrating the businesses of acquired companies and banks; sustain its current internal growth rate; provide quality and competitive products and services that appeal to its customers; continue to have access to debt and equity capital markets; and achieve its performance objectives. These and various other risk factors are discussed in Allegiance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 and in other reports and statements Allegiance has filed with the Securities and Exchange Commission. Copies of such filings are available for download free of charge from the Investor Relations section of Allegiance’s website at www.allegiancebank.com, under Financial Information, SEC Filings.  Any forward-looking statement made by Allegiance in this release speaks only as of the date on which it is made. Factors or events that could cause Allegiance’s actual results to differ may emerge from time to time, and it is not possible for Allegiance to predict all of them. Allegiance undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
          
 2018 2017
  June 30  March 31  December 31  September 30  June 30
 (Dollars in thousands)
Cash and cash equivalents$200,645  $190,088  $182,103  $192,427  $187,491 
Available for sale securities300,897  307,411  309,615  323,856  321,268 
          
Total loans2,358,675  2,290,494  2,270,876  2,201,540  2,114,652 
Allowance for loan losses(23,831) (24,628) (23,649) (23,722) (21,010)
Loans, net2,334,844  2,265,866  2,247,227  2,177,818  2,093,642 
          
Goodwill39,389  39,389  39,389  39,389  39,389 
Core deposit intangibles, net2,883  3,079  3,274  3,469  3,664 
Premises and equipment, net19,049  18,605  18,477  18,273  18,240 
Other real estate owned1,710  365  365  453  365 
Bank owned life insurance22,701  22,563  22,422  22,277  22,131 
Other assets44,308  39,118  37,359  35,472  38,526 
Total assets$2,966,426  $2,886,484  $2,860,231  $2,813,434  $2,724,716 
          
Noninterest-bearing deposits$749,787  $694,880  $683,110  $712,951  $662,527 
Interest-bearing deposits1,563,999  1,589,922  1,530,864  1,573,664  1,436,715 
Total deposits2,313,786  2,284,802  2,213,974  2,286,615  2,099,242 
          
Borrowed funds275,569  232,569  282,569  207,569  310,569 
Subordinated debt48,779  48,719  48,659  9,277  9,249 
Other liabilities8,404  8,406  8,164  7,246  7,197 
Total liabilities2,646,538  2,574,496  2,553,366  2,510,707  2,426,257 
          
Common stock13,341  13,302  13,227  13,171  13,153 
Capital surplus220,665  219,760  218,408  216,943  216,158 
Retained earnings90,089  82,533  74,894  71,690  68,704 
Accumulated other comprehensive (loss) income(4,207) (3,607) 336  923  444 
Shareholders' equity319,888  311,988  306,865  302,727  298,459 
Total liabilities and equity$2,966,426  $2,886,484  $2,860,231  $2,813,434  $2,724,716 
                    


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
              
 Three Months Ended Year-to-Date
 2018 2017 2018 2017
  June 30  March 31  December 31  September 30  June 30  June 30  June 30
 (Dollars in thousands, except per share data)
INTEREST INCOME:             
Loans, including fees$31,846  $30,117  $29,747  $28,588  $26,736  $61,963  $51,996 
Securities             
  Taxable646  599  563  547  503  1,245  1,001 
  Tax-exempt1,451  1,459  1,545  1,574  1,591  2,910  3,215 
Deposits in other financial institutions250  216  183  192  157  466  287 
Total interest income34,193  32,391  32,038  30,901  28,987  66,584  56,499 
              
INTEREST EXPENSE:             
Demand, money market and savings deposits887  976  992  811  702  1,863  1,356 
Certificates and other time deposits3,284  2,785  2,521  2,299  2,283  6,069  4,240 
Borrowed funds1,472  1,036  854  654  761  2,508  1,414 
Subordinated debt734  705  235  140  134  1,439  254 
Total interest expense6,377  5,502  4,602  3,904  3,880  11,879  7,264 
NET INTEREST INCOME27,816  26,889  27,436  26,997  25,107  54,705  49,235 
Provision for loan losses631  653  1,930  6,908  3,007  1,284  4,350 
Net interest income after provision for loan losses27,185  26,236  25,506  20,089  22,100  53,421  44,885 
              
NONINTEREST INCOME:             
Nonsufficient funds fees214  176  158  144  184  390  383 
Service charges on deposit accounts106  223  179  204  205  329  400 
Gain (loss) on sale of securities    30  (12)      
Gain on sale of other real estate1    6      1   
Bank owned life insurance138  141  145  146  146  279  294 
Rebate from correspondent bank564  444  388  370  336  1,008  569 
Other782  662  677  608  606  1,444  1,172 
Total noninterest income1,805  1,646  1,583  1,460  1,477  3,451  2,818 
              
NONINTEREST EXPENSE:             
Salaries and employee benefits12,778  12,794  12,188  11,580  10,415  25,572  20,977 
Net occupancy and equipment1,367  1,272  1,398  1,325  1,302  2,639  2,729 
Depreciation433  407  412  427  398  840  798 
Data processing and software amortization1,356  1,053  1,850  783  719  2,409  1,414 
Professional fees1,126  469  222  822  987  1,595  1,882 
Regulatory assessments and FDIC insurance509  534  533  582  569  1,043  1,158 
Core deposit intangibles amortization196  195  195  195  196  391  391 
Communications259  248  252  251  233  507  480 
Advertising342  330  436  302  288  672  551 
Other1,494  1,415  1,790  1,409  1,354  2,909  2,630 
Total noninterest expense19,860  18,717  19,276  17,676  16,461  38,577  33,010 
INCOME BEFORE INCOME TAXES9,130  9,165  7,813  3,873  7,116  18,295  14,693 
  Provision for income taxes1,574  1,454  4,609  887  1,721  3,028  3,251 
NET INCOME$7,556  $7,711  $3,204  $2,986  $5,395  $15,267  $11,442 
              
EARNINGS PER SHARE             
  Basic$0.57  $0.58  $0.24  $0.23  $0.41  $1.15  $0.88 
  Diluted$0.55  $0.57  $0.24  $0.22  $0.40  $1.12  $0.85 
                            


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
               
  Three Months Ended Year-to-Date
  2018 2017 2018 2017
   June 30  March 31  December 31  September 30  June 30  June 30  June 30
  (Dollars and share amounts in thousands, except per share data)
Net income $7,556  $7,711  $3,204  $2,986  $5,395  $15,267  $11,442 
               
Earnings per share, basic $0.57  $0.58  $0.24  $0.23  $0.41  $1.15  $0.88 
Earnings per share, diluted $0.55  $0.57  $0.24  $0.22  $0.40  $1.12  $0.85 
               
Return on average assets(A) 1.03% 1.09% 0.45% 0.43% 0.81% 1.06% 0.89%
Return on average equity(A) 9.55% 10.10% 4.15% 3.90% 7.32% 9.82% 7.95%
Return on average tangible equity(A)(B) 11.02% 11.71% 4.82% 4.55% 8.57% 11.36% 9.34%
Tax equivalent net interest margin(C) 4.21% 4.20% 4.33% 4.37% 4.29% 4.20% 4.33%
Efficiency ratio(D) 67.05% 65.59% 66.50% 62.14% 61.92% 66.33% 63.41%
               
Liquidity and Capital Ratios              
Allegiance Bancshares, Inc. (Consolidated)              
  Equity to assets 10.78% 10.81% 10.73% 10.76% 10.95% 10.78% 10.95%
  Tangible equity to tangible assets(B) 9.49% 9.48% 9.38% 9.38% 9.52% 9.49% 9.52%
  Estimated common equity tier 1 capital 10.60% 10.82% 10.54% 10.68% 10.85% 10.32% 10.85%
  Estimated tier 1 risk-based capital 10.97% 11.19% 10.92% 11.07% 11.24% 10.67% 11.24%
  Estimated total risk-based capital 13.42% 13.72% 13.43% 12.04% 12.13% 13.06% 12.13%
  Estimated tier 1 leverage capital 9.78% 9.98% 9.84% 9.90% 10.11% 9.78% 10.11%
Allegiance Bank              
  Estimated common equity tier 1 capital 11.04% 10.95% 10.72% 10.93% 10.23% 10.74% 10.23%
  Estimated tier 1 risk-based capital 11.04% 10.95% 10.72% 10.93% 10.23% 10.74% 10.23%
  Estimated total risk-based capital 13.49% 13.49% 13.24% 11.91% 11.12% 13.13% 11.12%
  Estimated tier 1 leverage capital 9.84% 9.77% 9.67% 9.77% 9.20% 9.84% 9.20%
               
Other Data              
Weighted average shares:              
Basic 13,327  13,262  13,187  13,165  13,125  13,294  13,073 
Diluted 13,634  13,542  13,496  13,483  13,471  13,588  13,425 
Period end shares outstanding 13,341  13,301  13,227  13,171  13,153  13,341  13,153 
Book value per share $23.98  $23.46  $23.20  $22.98  $22.69  $23.98  $22.69 
Tangible book value per share(B) $20.81  $20.26  $19.97  $19.73  $19.42  $20.81  $19.42 
                             
  1. Interim periods annualized.
  2. Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures on page 10 of this Earnings Release.
  3. Net interest margin represents net interest income divided by average interest-earning assets.
  4. Represents noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of  securities.  Additionally, taxes and provision for loan losses are not part of this calculation.
Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
                  
 Three Months Ended
 June 30, 2018 March 31, 2018 June 30, 2017
 Average Balance Interest Earned/ Interest Paid Average Yield/ Rate Average Balance Interest Earned/ Interest Paid Average Yield/ Rate Average Balance Interest Earned/ Interest Paid Average Yield/ Rate
 (Dollars in thousands)
Assets                 
Interest-Earning Assets:                 
Loans$2,312,725  $31,846  5.52% $2,260,119  $30,117  5.40% $2,042,460  $26,736  5.25%
Securities315,198  2,097  2.67% 312,769  2,058  2.67% 326,388  2,094  2.57%
Deposits in other financial institutions50,227  250  2.00% 49,897  216  1.75% 49,703  157  1.26%
  Total interest-earning assets2,678,150  $34,193  5.12% 2,622,785  $32,391  5.01% 2,418,551  $28,987  4.81%
Allowance for loan losses(24,753)     (23,949)     (19,253)    
Noninterest-earning assets280,852      272,430      261,668     
  Total assets$2,934,249      $2,871,266      $2,660,966     
                  
Liabilities and Shareholders' Equity                 
Interest-Bearing Liabilities:                 
Interest-bearing demand deposits$157,588  $208  0.53% $232,375  $317  0.55% $137,507  $118  0.34%
Money market and savings deposits522,381  679  0.52% 552,396  659  0.48% 499,335  584  0.47%
Certificates and other time deposits827,897  3,284  1.59% 800,343  2,785  1.41% 785,194  2,283  1.17%
Borrowed funds311,185  1,472  1.90% 250,414  1,036  1.68% 304,184  761  1.00%
Subordinated debt48,746  734  6.04% 48,684  705  5.87% 9,232  134  5.83%
  Total interest-bearing liabilities1,867,797  $6,377  1.37% 1,884,212  $5,502  1.18% 1,735,452  $3,880  0.90%
                  
Noninterest-Bearing Liabilities:                 
Noninterest-bearing demand deposits741,266      669,258      624,100     
Other liabilities7,778      8,251      5,890     
  Total liabilities2,616,841      2,561,721      2,365,442     
Shareholders' equity317,408      309,545      295,524     
  Total liabilities and shareholders' equity$2,934,249      $2,871,266      $2,660,966     
                  
Net interest rate spread    3.75%     3.83%     3.91%
                  
Net interest income and margin  $27,816  4.17%   $26,889  4.16%   $25,107  4.16%
                  
Net interest income and margin (tax equivalent)  $28,086  4.21%   $27,174  4.20%   $25,862  4.29%
                           


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
            
 Six Months Ended June 30,
 2018 2017
 Average Balance Interest Earned/ Interest Paid Average Yield/ Rate Average Balance Interest Earned/ Interest Paid Average Yield/ Rate
 (Dollars in thousands)
Assets           
Interest-Earning Assets:           
Loans$2,286,567  $61,963  5.46% $1,985,715  $51,996  5.28%
Securities313,990  4,155  2.67% 326,151  4,216  2.61%
Deposits in other financial institutions50,063  466  1.88% 51,511  287  1.12%
  Total interest-earning assets2,650,620  $66,584  5.07% 2,363,374  $56,499  4.82%
Allowance for loan losses(24,353)     (18,729)    
Noninterest-earning assets276,664      260,497     
  Total assets$2,902,931      $2,605,142     
            
Liabilities and Shareholders' Equity           
Interest-Bearing Liabilities:           
Interest-bearing demand deposits$194,774  $525  0.54% $134,226  $218  0.33%
Money market and savings deposits537,305  1,338  0.50% 493,092  1,138  0.47%
Certificates and other time deposits814,196  6,069  1.50% 735,458  4,240  1.16%
Borrowed funds280,967  2,508  1.80% 324,901  1,414  0.88%
Subordinated debt48,716  1,439  5.96% 9,218  254  5.56%
  Total interest-bearing liabilities1,875,958  $11,879  1.28% 1,696,895  $7,264  0.86%
            
Noninterest-Bearing Liabilities:           
Noninterest-bearing demand deposits705,461      612,120     
Other liabilities8,014      5,891     
  Total liabilities2,589,433      2,314,906     
Shareholders' equity313,498      290,236     
  Total liabilities and shareholders' equity$2,902,931      $2,605,142     
            
Net interest rate spread    3.79%     3.96%
            
Net interest income and margin  $54,705  4.16%   $49,235  4.20%
            
Net interest income and margin (tax equivalent)  $55,260  4.20%   $50,770  4.33%
                  


Allegiance Bancshares, Inc.
Financial Highlights
(Unaudited)
          
 Three Months Ended
 2018 2017
  June 30  March 31  December 31  September 30  June 30
 (Dollars in thousands)
Period-end Loan Portfolio:         
Commercial and industrial$452,307  $447,168  $457,129  $446,029  $444,701 
Mortgage warehouse51,552  41,572  69,456  83,577  73,499 
Real estate:         
Commercial real estate (including multi-family residential)1,134,903  1,108,537  1,080,247  1,045,220  1,008,027 
Commercial real estate construction and land development270,965  257,566  243,389  225,574  206,024 
1-4 family residential (including home equity)330,053  317,842  301,219  283,399  267,939 
Residential construction109,962  108,882  109,116  106,299  102,832 
Consumer and other8,933  8,927  10,320  11,442  11,630 
Total loans$2,358,675  $2,290,494  $2,270,876  $2,201,540  $2,114,652 
          
Asset Quality:         
Nonaccrual loans$12,137  $13,373  $13,328  $13,913  $19,330 
Accruing loans 90 or more days past due         
  Total nonperforming loans12,137  13,373  13,328  13,913  19,330 
Other real estate1,710  365  365  453  365 
Other repossessed assets740  443  205  205  205 
Total nonperforming assets$14,587  $14,181  $13,898  $14,571  $19,900 
          
Net charge-offs (recoveries)$1,428  $(326) $2,003  $4,196  $684 
          
Nonaccrual loans:         
Commercial and industrial$5,983  $6,153  $6,437  $5,031  $9,051 
Mortgage warehouse         
Real estate:         
Commercial real estate (including multi-family residential)4,917  6,466  6,110  8,097  9,556 
Commercial real estate construction and land development         
1-4 family residential (including home equity)1,237  754  781  735  568 
Residential construction         
Consumer and other      50  155 
  Total nonaccrual loans$12,137  $13,373  $13,328  $13,913  $19,330 
          
Asset Quality Ratios:         
Nonperforming assets to total assets0.49% 0.49% 0.49% 0.52% 0.73%
Nonperforming loans to total loans0.51% 0.58% 0.59% 0.63% 0.91%
Allowance for loan losses to nonperforming loans196.35% 184.16% 177.44% 170.50% 108.69%
Allowance for loan losses to total loans1.01% 1.08% 1.04% 1.08% 0.99%
Net charge-offs (recoveries) to average loans (annualized)0.25% (0.06)% 0.36% 0.78% 0.13%
               

Allegiance Bancshares, Inc.
GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures
(Unaudited)

Allegiance’s management uses certain non−GAAP (generally accepted accounting principles) financial measures to evaluate its performance. Allegiance believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance.  Allegiance believes that management and investors benefit from referring to these non-GAAP financial measures in assessing Allegiance’s performance and when planning, forecasting, analyzing and comparing past, present and future periods. Specifically, Allegiance reviews tangible book value per common share, return on average tangible equity and the ratio of tangible equity to tangible assets for internal planning and forecasting purposes. Allegiance has included in this Earnings Release information relating to these non-GAAP financial measures for the applicable periods presented.  These non-GAAP measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which Allegiance calculates the non-GAAP financial measures may differ from that of other companies reporting measures with similar names.

 Three Months Ended Year-to-Date
 2018 2017 2018 2017
  June 30  March 31  December 31  September 30  June 30  June 30  June 30
 (Dollars and share amounts in thousands, except per share data)
Total shareholders' equity$319,888  $311,988  $306,865  $302,727  $298,459  $319,888  $298,459 
Less:  Goodwill and core deposit intangibles, net42,272  42,468  42,663  42,858  43,053  42,272  43,054 
Tangible shareholders’ equity$277,616  $269,520  $264,202  $259,869  $255,406  $277,616  $255,405 
              
Shares outstanding at end of period13,341  13,301  13,227  13,171  13,153  13,341  13,153 
              
Tangible book value per share$20.81  $20.26  $19.97  $19.73  $19.42  $20.81  $19.42 
              
Net income$7,556  $7,711  $3,204  $2,986  $5,395  $15,267  $11,442 
              
Average shareholders' equity$317,408  $309,545  $306,346  $303,449  $295,524  $313,498  $290,236 
Less:  Average goodwill and core deposit intangibles, net42,393  42,589  42,758  42,954  43,149  42,491  43,246 
Average tangible shareholders’ equity$275,015  $266,954  $263,588  $260,495  $252,375  $271,007  $246,990 
              
Return on average tangible equity11.02% 11.71% 4.82% 4.55% 8.57% 11.36% 9.34%
              
Total assets$2,966,426  $2,886,484  $2,860,231  $2,813,434  $2,724,716  $2,966,426  $2,724,716 
Less: Goodwill and core deposit intangibles, net42,272  42,468  42,663  42,858  43,053  42,272  43,054 
Tangible assets$2,924,154  $2,844,016  $2,817,568  $2,770,576  $2,681,663  $2,924,154  $2,681,662 
              
Tangible equity to tangible assets9.49% 9.48% 9.38% 9.38% 9.52% 9.49% 9.52%
                     

Allegiance Bancshares, Inc.
8847 West Sam Houston Parkway N., Suite 200
Houston, Texas 77040
ir@allegiancebank.com 

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Source: Allegiance Bancshares, Inc.

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